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Costs: enhanced success fee for disease claims

High Court rejects claim that non-freezing cold injury is a "disease" entitling Claimant to 62.5 per cent success fee; meaning of "disease" in this context considered.

Implications

The decision in Patterson is a particularly helpful one to the Ministry of Defence (MOD) and other defendants faced with claims relating to conditions which are alleged to be a "disease" for the purposes of the success fee. Prior to this case, the success fee was either 25 per cent or 62.5 per cent and often cost settlements were made without agreeing to the percentage of the success fee but reflecting the risk that the success fee could be 62.5 per cent. Since the decision, there has been certainty as to the success fee.

Even with the introduction of the Jackson reforms, there are still a number of these claims outstanding.

In a case raising similar issues, Bird v Meggitt [2012] a County Court found that a claim for the exacerbation of a pre-existing condition was not a "disease" for the purpose of calculating the success fee. We understand that the appeal against this decision is not proceeding.

Background

The issue in this case was whether the non-freezing cold injury (NFCI) sustained by the Claimant was a "disease" contracted by him within the meaning of Section V of CPR 45. If it was, a success fee of 62.5 per cent would be recoverable on settlement of his claim. If it was not, the recoverable success fee would only be 25 per cent, in accordance with Section IV.

Claims falling within Section V are divided into three categories:

Type A - asbestos claim

Type B - claim relating either to a psychiatric injury due to work-related psychological stress or a work-related upper limb disorder alleged to have been caused by physical stress or strain, but excluding vibration injuries

Type C - a claim relating to a disease not falling within either type A or type B

Decision

Mr Justice Males held that the appropriate success fee was 25 per cent:

"Disease" must if possible be construed in a way which does not result in the exception taking up most of the room occupied by the basic rule in Section IV.

The starting point must be the natural and ordinary meaning of the words used, in their context. If there is to be a departure from or extension of the natural meaning, it must be at least reasonably clear what extended meaning the term "disease" was intended to have.

The Claimant had not demonstrated that the term "disease" in CPR 45 is used in other than its natural and ordinary meaning, save to the extent that the specific injuries included in the definitions of Type A and Type B claims must be regarded as constituting diseases for the purpose of the award of success fees. In particular, the definition of "disease" in the Pre-Action Protocol for Disease and Illness Claims was not a reliable guide to the meaning of "disease" in CPR 45.

NFCI is not caused or contributed to by any virus, bacteria, noxious agent or parasite. It is simply a case where blood fails to reach the cells in the nerves, skin and muscle as a result of exposure to weather or environmental conditions. The result is damage or injury to the body parts affected, but this cannot be regarded as a "disease".